Jerusalem, Dec 21 - Israeli Prime Minister Benjamin Netanyahu was set to convene his inner cabinet for a discussion on a prisoner swap with Hamas - which would see Israel release hundreds of Palestinian prisoners in return for Gilad Shalit, the soldier held in the Gaza strip for over three years.

Although Sahlit's father, Noam, said the negotiations over his son's release had reached the point of no return, Israeli officials were quoted on Channel 2 News as saying that the deal was still not completed.

According to the news channel, the debate now centered around whether prisoners released by Israel could return to their homes in the West Bank, or whether they would be exiled to the Gaza Strip, which is run by Hamas, or even sent abroad.

The seven-member inner cabinet Sunday evening is believed to be divided over the terms for Shalit's release, with three ministers said to be in favour, and three opposed, leaving the prime minister with the casting vote.

The ministers were due to meet once Netanyahu finished his talks with visiting Egyptian security chief Omar Suleiman. Egypt has been heavily involved in trying to mediate a prisoner swap between Israel and Hamas. However, the talks reportedly went into high gear only after Germany joined the mediation efforts.

Egyptian officials in Cairo had on Saturday denied that Sulieman's visit to Jerusalem was connected to the Shalit prisoner negotiations.

Gilad Shalit's parents meanwhile delivered a letter to Netanyahu Sunday afternoon, in which they urged the prime minister to increase efforts to secure their son's release.

"Our hearts tell us that the negotiations have reached a point of no return," the letter said.

"We are at a crossroads that has only two possible outcomes - the rescue of Gilad Schalit and his safe return home, or leaving of his fate to the hands of Hamas," the letter continued.

Shalit was snatched June 25, 2006 during a cross-border raid launched from the Gaza Strip.

Since then he has been held largely incommunicado, although Hamas, which is holding him, has released one audio tape of his voice, transferred three letters to his family, and in Oct 2 this year released video recording in which he pleaded for the Israeli government to do everything to secure his freedom. (dpa)